Monte Carlo simulation can be used in financial modeling as a form of risk analysis. Though it’s not commonly performed, software such as @Risk, Palisade, and others can be used to analyze how the value of a business (in a DCF model) is impacted by over thousands of changes to assumptions in the model that follow a certain type of distribution.
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CFI is the official global provider of financial modeling and valuation analyst FMVA Designation. CFI's mission is to help anyone become a world-class financial analyst and has a wide range of resources to help you along the way. In order to become a great financial analyst, below are some additional questions and answers for you to explore further: